All Forum Posts by: Rob Grove

I'm not one for New Years resolutions cause I'm like the rest, set an arbitrary goal and forget about it in a couple days. I once tried to do it the smart way and set one resolution for each month and take the month to focus on one habit I wanted to change. You know, because the experts tell you it takes 30 days to break a habit.... That didn't last long either. This year is different. 

I quit using Facebook over a month ago because I was wasting to much time on it and it doesn't add any value to my life and picked up a book by j. Scott on how to flip houses. It's not the first time I stop everything and pick up an entrepreneurial book and get all motivated but do nothing.... I need to make something happen this year, if not multiple things.  Well with funds tight, i need to find a way to make extra money so I've been looking into getting my real estate license. I have an appointment Wednesday to talk to a broker about the fees that are involved to keep a license in Minnesota.  

Also I've been looking at the local market and saw two houses that looked like good flips.... I've also thought about wholesaling and have done some driving around and both houses now have investors in front of the houses so given the right circumstances, if they are making it work, I could have too. Tonight I got in contact with my first cash buyer so it's time to start wholesaling. I have a learning curve but I'm going to make it work. I'm going to look for a few more cash buyers  in the next couple days but then it's time to make something happen. I probably going to try to sell a few houses since I'm pretty sure I'll be getting my RE license. 

I'm pretty excited about talking to the investor today so I wanted to share. You'll be seeing a lot more of me around this forum trying to learn, get it right, and make it happen. Thanks bigger pockets for your podcast, forum and everything else you do that helps keep me motivated and learning. 

@Rick H. I talked to my realtor about local laws and requirements and found out there is a bunch of fees required to be part of a brokerage. Nonetheless,I have an appointment Wednesday to talk to their business development coach. Seems like this brokerage offers tons of training which is nice. I'm determined to make money this year in this industry! 

Good evening everyone, 

I have a question about how to get a line of credit from home equity to use to flip houses or buy a rental. How do you do it?

Current situation:

I bought my first house in March for 209,900 with the va home loan. It's a 4 bedroom 3 bath split level with .40 acres that backs up to a creek and a trail in a pretty nice well established area. It was Solidly Built in 1979. I just got a grant for 10k to have new Windows put in which is awesome since the Windows were original wood crank outs. but we have to live here for 5 years or pay 20% for each year that we aren't here for whatever reason.

Anyway the house is pretty original with the exception of an on suite remodel, newer carpet and hardwood in the kitchen. I've done a few upgrades to the house already but for time sake I won't get into the little stuff.

Two houses On the same street with similar specs and condition have just sold this summer for 240k and 250k. I found another house not to far away for 260k with a little more modern upgrades but not a lot. My neighbor just redid his siding and Windows too which should help increase the value of my house. 

I'm thinking by painting all the trim, giving the kitchen a facelift, new light fixtures, and probably replacing the wood front with maintenance free like the rest (which will get rid of my wood pecker problem) and maybe a new front door or paint that, redo one of the bathrooms possibly both so all three are redone , I should be sitting  with a house in the 250-280 range. I plan on keeping this as a rental when we move so I don't want to go over board and this area isn't really a high end finish area that I've noticed but I plan on visiting open houses, watching for new houses the go up for sale to watch the local market.

My wife and I are pretty thrifty and I think we can get a lot done for under 5k

I don't know a whole lot (nothing really) about getting a line of credit from my home equity to  invest in RE but just the general idea. 

Do I just get my house reappraised and if it is more than what I owe, I can get a HELOC?

What is the normal home value to loan ratio that is out there?

Is this worth doing?

If my home reappraises for more then do my payments go up and is this just from taxes?

Is there any downsides to this?

Any links, tips, tricks or reading material on this would be great! Thanks!! 

My main goal was to gain access to the MLS so I can do my own Market Research and have real time access what's on the market. From what I have found with what little research and phone calls I have made, a for sale sign or real estate website, doesn't tell you what is going on. For example, a duplex by where I used to live had a for sale sign in the yard, when I went to the Real Estate company's website, it didn't say it was pending, so I called the agent and it had been in Pending Status for several months.

A few pros that I came up with

-Access to the MLS

-If I can sell a few deals to make some extra cash to help me invest it's a win.

-Networking

-Getting actual experience in Real Estate even if it's not investing at first. 

-Not that I want to be a Full Time RE Agent but I am pretty good at sales.

-saving on Sales Commission when I do my own deals

-Not really a pro but I am used to being held at a higher standard and am ethical. I wouldn't want to get over on someone to make a buck.

-knowing what sells and what doesn't

-knowing how the current market is. 

-being able to see seasonal trends

Cons:

-Unsure about the requirements to keep my license. Do I have to be a pt REA and do Brokers even hire PT REA and if so, what are their sales requirements and/or fees.

-If I start doing pt RE Sales, listening to my wife complain that I am gone more.

-Potentially two jobs (even though I want to flip houses but the payoff would be better than a commission check.)

Not sure what other cons are... 

I'm going to sign up this week. 

How embarrassing. Not only did I misspell license once but a few times... I'm gonna blame it on my phone...

Nonetheless, I made it through college  with the GI Bill to get the piece of paper, because I knew it would help me make more money and it was the right thing to do when  I got out of the service. My main take away from college was, if you want to make more money, you need to jump jobs. I've been working a 9-5 again for just over a year and I would rather be working for myself doing real estate investments.

I plan on making some sort of deal happen this year, not quite sure how I am going to make it happen but I will. Currently, I use zillow to do my research but I know it's not accurate and is missing a lot of the key information that the MLS has. Even when I bought my current residence, with what little a access I had to the MLS, I knew I was going to have instant equity with some cosmetic upgrades to my home.

Right now I am leaning towards making the commitment. Like you said, it will only scratch the surface, but I think will help me in a variety of ways which will pay for itself in the long run. Plus, I am one of those people who doesn't like to, "not know" things and I like  understand the process. When I bought my home, I didn't quite feel as in control as I wanted too. 

Thanks for everyone's input!! 

Do you know where or how to get grants for this type of housing? If so, do you know if they would give them to a first time investor? (I own my personal residence)

Do you know anyone who wants out and is willing to seller finance? . If I had a solid business plan, I could possibly get some help with all or part of the financing from a family member of the numbers make sense.

I'd be interested in talking to anyone of your clients If they are willing to help a newbie @Tim Campbell

I work in North so I could meet for coffee or lunch anytime. Thank you for the info you have provided thus far!

I just recently listened to a podcast on BP where a guy turned a duplex into a rent by room and increased his profits. I just started managing a facility where a lot of people live in these types of properties and pay between 5-700 a month in north Minneapolis (pretty bad area). When I talked to my wife about this, she said she stayed in one near the U of MN when she went to school there. 

Ideally around a university would probably be better for a variety of reasons but I may need to start in the bad area since its cheaper. Luckily my current job has given me the experience of dealing with the roughneck crowd (and I can legally carry a gun.... Which is also a +) ok it's not that bad... In most parts.

A few questions: 

What does it take to turn a SFH or duplex into a rent by room? Does this require getting rid of common areas like LR amd DR and creating bedrooms? Getting permits for these changes and that's it? Do I have to do anything special to get these changes approved by anyone? Anything I'm missing? Thanks in advance !

I'm reading the book, the book on flipping houses and the author recommends getting my real estate lisence. I haven't done any deals yet but think I have 3 options to help me do my first deal this year. Would you recommend that I get my license? What are some pros and cons? More money, more knowledge, and access to the MLS are some of the obvious pros. I'm not looking to replace my job to be a real estate agent and with all the paperwork that was required to buy my current home, how do you know you're doing it right when you don't work for real estate company? Thanks in advance.

@Ruth Bayang Selling an LLC? Can your provide me with more details? Seems like you would have to start a llc before you secure the property under contract, and then get it under contract and sell it to an investor before the contract expires... is that how it works?